Trade policy is once again in the spotlight with President Obama’s announcement this week of a new suit against China in the World Trade Organization (WTO).
The President announced the action—which argues that China unfairly subsidizes parts of its automotive industry—during a speech on Monday in Ohio.
In announcing the action, the President claimed that his Administration has “filed twice as many cases as the previous administration.” That is just not true.
Over the past four years, the President has brought 11 cases to the WTO over a range of things, including a case against China over rare earth mineral and one against India over agricultural imports. In comparison, President Bush brought 12 cases against various countries during the first four years of his Administration and 24 cases over his entire eight-year presidency.
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Diligence should certainly be paid to China’s trade policies. However, the United States needs a robust trade policy that takes into account the potential unfair trade practices of all WTO members. For example, the President has failed to pressure the EU over unfair carbon taxes that hurt American air carriers servicing the eurozone.
Under the Obama Administration, 73 percent of U.S. cases have been filed against China, though that country accounts for only about 14 percent of total U.S. trade. The President should press for free trade throughout the world instead of focusing on narrow policies that appeal to domestic interest groups.
The benefits of free trade are clear, but rhetoric and political jockeying has diverted attention from its obvious benefits. Misleading and deceptive trade rhetoric is not good policy: It hurts Americans and our economic standing.
